Health and finance collide because of the Shs9b tax on Covid-19 pick-up trucks

Health Department officials have clashed with their counterparts at the Treasury Department after the Treasury Department blocked tax exemptions for 282 pick-up trucks raised with donations to help respond to Covid-19. Two weeks ago, the Ministry of Health raised 282 double-cab pick-up trucks valued at Shs 23 billion from donations and applied for a Shs 9 billion tax exemption. The ministry argued that the vehicles were obtained through donations. However, the Treasury Department insisted that all government purchases are taxable and those who did not plan the taxes must be held accountable. A source close to the recent tax exemption dispute told the Sunday Monitor that health department officials should have withheld that money for almost a year and allowed taxes to be taken when placing orders coming to the country, but they always put their tax administrations before shipping, and the state secretary in the Ministry of Health, Dr. Diana Atwine, passionately turned to lawmakers to intervene so the ministry could get a tax exemption. They said they didn’t have a Shs9b for taxes. URA Writes to Ministry of Health On July 6, the Uganda Revenue Authority (URA) Customs Commissioner wrote to the Ministry of Health, asking them to send their licensed clearing agent to the vehicle before releasing it checks are handed over to the government. Mr Abel Kgumire instructs in his letter that the Ministry should first deliver the vehicles from the donors before they are released, which will facilitate the release as stated in our letter above. You must hand over said vehicles from the donors to yourself prior to customs clearance, ”said Mr Kagumire. The Treasury Department and the Department of Health, along with the URA, held several meetings where they agreed that the government would pay taxes on the vehicles and transfer them to the government prior to clearance. It is not clear why the Ministry of Health insists on tax exemptions when the Ministry of Finance had indicated that the Ministry of Health would have money to pay taxes and powers to grant exemptions. He said the Ministry of Health should have known better and planned the taxes when procuring the vehicles.

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